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  • Writer's pictureMark Watson-Mitchell

Pantheon Resources – latest report validates scale of its 1bn barrels Kodiak resource, shares up 15%

Pantheon Resources – latest report validates the massive scale of its 1bn barrels Kodiak resource, shares up 15%

Jay Cheatham, the CEO of Pantheon Resources (LON:PANR) sounded very excited about the Netherland Sewell & Associates intensive review of the Lower Basin Floor Fan reservoir of the company's Kodiak project on the North Slope of Alaska.

"This really is a big deal.

A credible third-party estimate of nearly one billion barrels of recoverable liquids for a company the size of Pantheon is an incredible achievement, validating our geological model.

This is the first IER conducted on our largest asset and will have enormous value in financing discussions and in attracting potential partners.

As I have repeatedly said, big oilfields continue to get bigger, and with additional wells and data points we expect this contingent resource to grow and for some or all to be classified as reserves once we achieve a Final Investment Decision."

The report confirms gross (and net) 2C contingent resources of "total marketable liquids" of 963 mmbbls.

The 2C estimates (best estimates) of oil and natural gas liquids total 962.5m barrels of marketable liquids.

The NGLs on Pantheon's projects are of material value because they can be blended with the oil and the combined stream of oil, condensate and have been estimated by management to yield approximately 90% of the value of the Alaska North Slope price per barrel.

With some 126,000 acres of field, the company believes that this is one of the largest basin floor fan systems discovered onshore in the past few decades.

Analyst Charlie Sharp at Canaccord Genuity Capital Markets has rated the £141m capitalised group’s shares as a Speculative Buy, setting a 100p Price Target.

We see this figure a "best estimate" of almost 1bn barrels - as an important confirmation of the scale of the Kodiak discovery.

It is a critical first step in the process of further appraisal towards the potential establishment of the commerciality of this very large, now independently verified, resource base and Pantheon's aim to deliver recognition of the $5-$10/bbl market valuation for those resources.

The group's shares are up 15% this morning, 2p better at 15.64p.


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